Oil and gas firm flags progress on unlocking value from North Sea assets

0 ‘Investment decision hopes’ – CEO Andrew Hockey Energy firm Independent Oil & Gas (IOG) yesterday said it was targetting a final investment decision on its core gas project in the North Sea in the first half of the year.

The firm, which reported that full-year losses had more than doubled to £5.64 million in 2018, said that progress was continuing on ongoing farmout discussions on the hub project which brings together interests across a number of licence areas.

Chief executive Andrew Hockey said it had been a year of progress across IOG’S southern North Sea (SNS) portfolio.

“We continue to move toward our goal of bringing indigenous UK gas into the import-dependent UK market safely and at a low unit cost to generate material cash flows for the group and attractive returns for our shareholders,” he said.

Hockey said the firm expects to be in a position to select its preferred party to deliver either a farm-in or capital markets solution to reach a final investment decision on its core project soon.

Daniel Slater at Arden Partners, which has a “buy” recommendation on the shares, said IOG has built a significant development asset position with some 54 million barrels of oil equivalent of reserves.

“We continue to believe in the attractiveness of IOG’S assets and development plans, with funding remaining the main hurdle,” he said.

Earlier this month the company announced a £16.6m placing along with a debt rescheduling to help provide funding to drill its Harvey appraisal well this summer, which Slater said provided “renewed breathing room” as it works toward securing an investment decision for its main project.

Last month the firm rejected an unsolicited proposal from Rockrose Energy to acquire it in a £27m deal.